Merkel Seeks to Reach an EU-Mercosur FTA

Written by | Wednesday, June 18th, 2014

Germany’s Angela Merkel promised to Brazil on Sunday (June 15) that she would do her best to successfully finalize the 15-year-long talks of a free trade agreement between South America’s trade block Mercosur and the European Union. The German Chancellor is currently visiting Brazil where she has come to attend a few soccer matches of the German national team in the World Cup. Mrs Merkel said that there was a lot to gain from a free trade agreement for both Mercosur and the European Union while stressing that both sides have been interested in reaching the final deal. Multilateral talks have been held since 1999 on an off-and-on basis, but more serious steps were revived only four years ago after they had been more or less frozen for 6 years. Now, although both sides seem to be ready, no deadline has been set so far, the EU External Action Service Director, Christian Leffler, added.
Ms Merkel also met with Brazil’s President, Dilma Rousseff, with whom she discussed possible directions of further expansion in scientific cooperation, energy sector, renewable energy, and even investment flows including joint ventures. However, the Mercosur is a block formed by many countries – Argentina, Brazil, Paraguay, Uruguay, and Venezuela – which, together with EU28, renders the EU-Mercosur negotiations truly multilateral. The involvement of many particular countries is likely among the biggest obstacles to finalizing the free trade agreement as each and every country faces different concerns. Venezuela, being the newest Mercosur member, decided not to participate in the deal at all due to the fears of competition while Brazil is expecting that the deal would help boost its faltering economy. In contrast, European economies, such as Ireland, are worried that they will not be able to compete in meat production as Argentina and Brazil are currently the world’s largest chicken and beef exporters.

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